Law:

Section:

Section 158B of the Income-tax Act, 1961 - Block assessment in search cases - Undisclosed income - During block assessment, Assessing Officer observed that certain cash was mentioned in books of account, but no such cash was actually available with assessee - Assessing Officer, rejecting assessee's explanation that cash in question had been advanced in connection with business of company, made addition of cash - Tribunal accepting assessee's explanation deleted addition - Whether, on facts, Tribunal was justified in doing so - Held, yes Section 158B of the Income-tax Act, 1961 - Block assessment in search cases - Undisclosed income - During block assessment, Assessing Officer made addition of certain sum representing payments made to 'A' by assessee for gas cylinders purchased from 'A', holding that no such transaction had actually taken place between assessee and 'A' - Assessing Officer also made addition on account of proportionate interest on amount advanced to 'A' - Tribunal observing that purchase transactions with 'A' had been disclosed by assessee in return and same were accepted as genuine in course of assessment concluded under section 143(3), deleted additions - Whether, on facts, Tribunal was justified in doing so - Held, yes FACTS Subsequent to the search, during block assessment, the Assessing Officer observed that according to the books of account, the assessee had a certain sum as cash in hand, but no such cash was actually available with the assessee. The assessee explained that the cash had been advanced in connection with the business of the company. The Assessing Officer, however, rejected said explanation and taking the view that amount in question was not proved to have been utilized for the business of the company and was advanced as interest-free loan to the employees made addition. The Assessing Officer also made addition of certain sum, representing payments made to 'A' for the gas cylinders purchased from the said concern, relying upon the statement of one of the directors of the said company and held that no such transaction had actually taken place between the assessee and 'A'. The Assessing Officer further made addition on account…

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